Sydney’s west is doing fine, Julia

At Rooty Hill,
Julia Gillard
’s base for her prime ministerial week in western Sydney, asking prices for homes have risen 10 per cent in the past year.

Just down the road, in the industrial estates of Arndell Park and Eastern Creek, vacancies are falling.

And in the region’s central business district, Parramatta, new office and apartment tower projects are taking shape.

If western Sydney has had enough of Labor, it is not because of property pain. Quite the opposite; as the region emerges from almost a decade of falling property investment, many of its voters simply do not want any more Labor solutions.

They don’t want more patches and handouts and promises and blockages. What they want is a vision of an even better future and a pathway to achieve it.

House prices fell below values in Melbourne’s west, new housing starts fell to post-war lows, employment in building evaporated, hundreds of new factory units lay empty and south-west Sydney had the highest mortgage arrears in the country.

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But with continued population growth, affordable house prices, low interest rates and the encouragement of the Barry O’Farrell government, property in the region has turned.

Figures from MacroPlan and RP Data show that house price growth in the west has well outpaced the collapse in the affluent east.

In Macquarie Fields, one of the epicentres of mortgage arrears and social discontent, house prices have lifted 19 per cent in the past two years, according to Fairfax Media’s Australian Property Monitors.

“It is affordability," says APM economist Andrew Wilson, pointing to the median price in Macquarie Fields of just $311,000.

“There is a low level of gentrification that is driven by affordability," he says.

As prices of existing houses lift, so follows the demand for new homes.

The largest land developer in the region, the NSW Government’s UrbanGrowth, has recorded a 56 per cent lift in land sales across the west in the year to January.

UrbanGrowth’s general manager of marketing, Robert Sullivan, says the lift is due both to new supply, as UrbanGrowth tracks towards its new government targets, and higher demand – boosted by interest rates and the increased handouts to first home buyers of new homes.

As housing lifts, so does the rest of the regional economy.

In Merrylands, Stockland spent $400 million upgrading its shopping mall. Customer traffic is up 40 per cent and each customer is spending 20 per cent more.

In Westfield Group’s western Sydney malls, spending increased in Liverpool by 7.8 per cent, and in Mt Druitt and Penrith by 1.2 per cent. Only Parrramatta slid.

By comparison, sales dipped in Chatswood and Bondi Junction, two of the flagships in Sydney’s east.

At year end, Knight Frank surveyed 69 office buildings in the south-west, in Bankstown, Liverpool and Campbelltown, to find just 5 per cent vacancy.

Western Sydney’s industrial market, one of the largest in the country, is also on the improve.

Australand Property Group’s executive general manager, commercial and industrial, Sean McMahon, said western Sydney had a very active second half in 2012.

At the same time, the mood has changed in Parramatta with over 1000 apartments planned by developers like Meriton and Crown, and commercial groups like Westfield and the DEXUS Property Group planning over 80,000 sq m of office and industrial space.

None of that is to ignore the challenges of western Sydney. Top of the list is jobs. But it is about the creation of new jobs, not a fight over who gets the old.

“We have a tsunami of population but not a tsunami of jobs," says the Western Sydney director of the Sydney Business Chamber, David Borger, pointing to the already 200,000 workers who travel east each day.

Borger wants real new jobs in the “traded economy", like the 40,000 positions that would come with an airport at Badgerys Creek or the jobs that could be created if the Parramatta CBD became a genuine urban centre for living and working.

This week has been a step back. In Rooty Hill, house asking prices dropped in the week Gillard’s trip was announced. “This is the quietest week we have had in some time," a local agent said